NORTHPOINTE BANCSHARES INC
For the period ended Sep 30, 2025. Filed Nov 12, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Nov 12, 2025
NPB$15.76-0.8%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-08-13.
0001336706-25-000004
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-11-12.
0001336706-25-000008
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 160 previous paragraphs and 167 current paragraphs.
84 unchanged; 70 reworded; 13 added; 5 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 35 previous and 35 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (13)
Current report
On October 1, 2025, the United States federal government experienced a partial shutdown that affected certain federal agencies and services. We evaluated the impact of the government shutdown on our operations, financial reporting, and liquidity. While the shutdown resulted in delays in the processing of certain government-backed mortgage loans and temporarily limited or eliminated access to some federal data sources or programs used in underwriting, insurance and compliance, we have been able to continue our core banking and mortgage origination activities without material interruption.
Current report
We have assessed the potential effects of the shutdown on credit risk, loan origination, and regulatory compliance. As of the date of these financial statements, we have not identified any material adverse impact on our financial condition, results of operations, or cash flows attributable to the government shutdown. We continue to monitor developments and will update our assessment as necessary in future reporting periods.
Current report
Our allowance for credit losses, liquidity position, and regulatory capital ratios were not materially affected by the government shutdown. We maintain contingency plans to address disruptions in government services and have procedures in place to mitigate risks associated with delays in government-backed loan programs and other federal activities.
Current report
We believe that the consolidated financial statements as of and for the period ended September 30, 2025, appropriately reflect all known impacts of the government shutdown. Actual results may differ from our current estimates if the effects of future government shutdowns or related disruptions become more significant.
Current report
Highlights of the Third Quarter of 2025
Current report
Net interest margin was 2.47% for the three months ended September 30, 2025, an increase of 27 basis points from 2.20% for the three months ended September 30, 2024. Net interest margin was 2.43% for the nine months ended September 30, 2025, an increase of 13 bps from 2.30% for the nine months ended September 30, 2024.
Current report
(2) Includes proceeds from portfolio loan sales, which are netted against any associated changes in fair value of loans to determine total gain or loss on sale.
Current report
(2) Includes proceeds from portfolio loan sales, which are netted against any associated changes in fair value of loans to determine total gain or loss on sale.
Current report
For the three months ended September 30, 2025, net gain on sale of loans decreased by $3.6 million, as compared to the same period in 2024. Net gain on sale of loans in the three months ended September 30, 2025 included a gain of $2.2 million from the combined change in fair value of loans HFI and LRA, both attributable to changes in market interest rates, and a gain of $1.2 million on the sale of portfolio loans. In the three months ended September 30, 2024, the combined change in fair value of loans HFI and LRA totaled $17.8 million and we had net loss on sale of portfolio loans of $8.0 million. Excluding these items, net gain on sale of loans was $17.5 million, up $2.7 million from $14.8 million in the three months ended September 30,
Current report
The increase from the prior year quarter was driven primarily by higher saleable residential mortgage rate lock commitments and originations.
Current report
For the nine months ended September 30, 2025, net gain on sale of loans increased by $9.2 million, as compared to the same period in 2024. Net gain on sale of loans in the nine months ended September 30, 2025 included a gain of $7.7 million from the combined change in fair value of loans HFI and LRA, both attributable to changes in market interest rates, and a gain of $1.2 million on the sale of portfolio loans. In the nine months ended September 30, 2024, the combined change in fair value of loans HFI and LRA totaled $16.8 million and we experienced net loss on sale of portfolio loans of $8.0 million. Excluding these items, net gain on sale of loans was $49.9 million, up $9.1 million from $40.8 million in the nine months ended September 30, 2024. The increase from the nine months ended September 30, 2024 was driven primarily by higher saleable residential mortgage rate lock commitments and originations.
Current report
For the three months ended September 30, 2025, other taxes and insurance increased by $396,000, as compared to same period in 2024, and increased by $80,000 for the nine months ended September 30, 2025, as compared to the same period in
Current report
The increase in other taxes and insurance in both periods was driven primarily by higher FDIC assessment expense resulting from the growth in assets and continued utilization of capital.
Removed paragraphs (5)
Previous report
Highlights of the Second Quarter of 2025
Previous report
Net interest margin was 2.44% for the three months ended June 30, 2025, an increase of 11 basis points from 2.33% for the three months ended June 30, 2024. Net interest margin was 2.40% for the six months ended June 30, 2025, an increase of 5 bps from 2.35% for the six months ended June 30, 2025.
Previous report
For the three months ended June 30, 2025, net gain on sale of loans increased by $5.6 million, as compared to the same period in 2024. This was driven primarily by an increase in the fair value of loans of $4.0 million, which included a $1.4 million increase related to an agreement entered into at the end of the second quarter of 2025 to sell $40.3 million in unpaid principal balance of home equity (non AIO) loans, along with higher gains on the sales of loans resulting from increased saleable mortgage volume over the same period.
Previous report
For the six months ended June 30, 2025, gain on sale of loans increased by $12.9 million, as compared to the same period in 2024. This was driven primarily by an increase in the fair value of loans of $9.9 million, which was attributable to lower market interest rates, higher gains on sale of loans, and the $1.4 million increase in fair value from the home equity (non AIO) loan sale agreement.
Previous report
We had a loan repurchase reserve net benefit of $98,000 in the three months ended June 30, 2025 compared to a net benefit of $1.1 million for the same period in 2024. For the six months ended June 30, 2025, we had a loan repurchase reserve net benefit of $165,000 compared to a net benefit of $2.0 million for the same period in 2024.
Reworded paragraphs (70)
Previous wording
The following section presents additional information and highlights significant changes in the financial condition of Northpointe Bancshares, Inc. (the “Company”) and our wholly owned subsidiary, Northpointe Bank (the “Bank”), from December 31, 2024 through June 30, 2025, and on our results of operations for the three and six months ended June 30, 2025 and 2024. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q. This discussion and analysis contains forward-looking statements that involve risk, uncertainties and assumptions. Certain risks, uncertainties and other factors, including but not limited to those set forth under “Cautionary Note Regarding Forward-Looking Statements,” “Risk Factors,” and elsewhere in this Quarterly Report on Form 10-Q, may cause actual results to differ materially from those projected in the forward looking statements. We assume no obligation to update any of these forward-looking statements.
Current wording
The following section presents additional information and highlights significant changes in the financial condition of Northpointe Bancshares, Inc. (the “Company”) and our wholly owned subsidiary, Northpointe Bank (the “Bank”), from December 31, 2024 through September 30, 2025, and on our results of operations for the three and nine months ended September 30, 2025 and 2024. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q. This discussion and analysis contains forward-looking statements that involve risk, uncertainties and assumptions. Certain risks, uncertainties and other factors, including but not limited to those set forth under “Cautionary Note Regarding Forward-Looking Statements,” “Risk Factors,” and elsewhere in this Quarterly Report on Form 10-Q, may cause actual results to differ materially from those projected in the forward looking statements. We assume no obligation to update any of these forward-looking statements.
Previous wording
Headquartered in Grand Rapids, Michigan, we are a bank holding company that focuses on (1) providing a best-in-class platform for independent mortgage bankers nationwide to utilize as an alternative to traditional mortgage warehouse lending (we refer to this business as our Mortgage Purchase Program, or “MPP”) and (2) offering attractive products and services to our residential mortgage and digital banking retail customers. Our residential lending business provides a comprehensive range of financing options nationwide through two main channels: consumer direct and traditional retail. We have a total of 130 mortgage originators across 27 states. These channels combine the convenience of online, self-service platforms with the personalized service of an experienced residential mortgage loan officer. Both residential mortgage loan origination channels are supported by our proprietary point-of-service digital platform that streamlines the loan application and closing processes. Our consumer direct and traditional retail channels primarily originate mortgage loans which are saleable through an end investor. In addition, our traditional retail channel selectively originates first-lien home equity lines which are tied seamlessly to a demand deposit sweep account (we refer to the loans we originate as “All-in-One” or “AIO” loans). We have one bank branch located in Grand Rapids, Michigan and physical loan production offices located in 23 cities in 15 states across the country, which are supported by our centralized operations and back-office support teams based in Grand Rapids, Michigan.
Current wording
Headquartered in Grand Rapids, Michigan, we are a bank holding company that focuses on (1) providing a best-in-class platform for independent mortgage bankers nationwide to utilize as an alternative to traditional mortgage warehouse lending (we refer to this business as our Mortgage Purchase Program, or “MPP”) and (2) offering attractive products and services to our residential mortgage and digital banking retail customers. Our residential lending business provides a comprehensive range of financing options nationwide through two main channels: consumer direct and traditional retail. We have a total of 129 mortgage originators across 26 states. These channels combine the convenience of online, self-service platforms with the personalized service of an experienced residential mortgage loan officer. Both residential mortgage loan origination channels are supported by our proprietary point-of-service digital platform that streamlines the loan application and closing processes. Our consumer direct and traditional retail channels primarily originate mortgage loans which are saleable through an end investor. In addition, our traditional retail channel selectively originates first-lien home equity lines which are tied seamlessly to a demand deposit sweep account (we refer to the loans we originate as “All-in-One” or “AIO” loans). We have one bank branch located in Grand Rapids, Michigan and physical loan production offices located in 25 cities in 16 states across the country, which are supported by our centralized operations and back-office support teams based in Grand Rapids, Michigan.
Previous wording
Our consolidated financial statements are prepared in accordance with United States generally accepted accounting principles (“GAAP”) and follow general practices within the banking industry. Application of these principles requires management to make estimates, assumptions and complex judgements that affect amounts presented in our consolidated financial statements. These estimates, assumptions and judgements are based on information available as of the date of the financial statements; accordingly, as this information changes, the consolidated financial statements could reflect different estimates, assumptions, and judgements. Our critical accounting policies are described in detail in our 2024 Form 10-K.
Current wording
Our consolidated financial statements are prepared in accordance with GAAP and follow general practices within the banking industry. Application of these principles requires management to make estimates, assumptions and complex judgments that affect amounts presented in our consolidated financial statements. These estimates, assumptions and judgments are based on information available as of the date of the financial statements; accordingly, as this information changes, the consolidated financial statements could reflect different estimates, assumptions, and judgments. Our critical accounting policies are described in detail in our 2024 Form 10-K.
Previous wording
Our accounting and reporting policies are in accordance with accounting principles generally accepted in the United States of America and conform to general practices within the banking industry. Accounting and reporting policies for the allowance for credit losses (“ACL”), lender risk account and capitalized mortgage loan servicing rights are deemed critical since they involve the use of estimates and require significant management judgments. Application of assumptions different than those that we have used could result in material changes in our financial position or results of operations.
Current wording
Our accounting and reporting policies are in accordance with GAAP and conform to general practices within the banking industry. Accounting and reporting policies for the allowance for credit losses (“ACL”), the lender risk account (“LRA”) for loans we have sold to the Federal Home Loan Bank of Indianapolis (“FHLB”), and the capitalized mortgage loan servicing rights (“MSR”) are deemed critical since they involve the use of estimates and require significant management judgments. Application of assumptions different than those that we have used could result in material changes in our financial position or results of operations.
Previous wording
Our methodology for determining the ACL and related provision for credit losses is described later in this section under “Provision for Credit Losses” and “Loan Portfolio”. In particular, this area of accounting requires a significant amount of judgment because a multitude of factors can influence the ultimate collection of a loan or other type of credit. It is extremely difficult to precisely measure the amount of expected credit losses in our loan portfolio. We use a rigorous process to attempt to accurately quantify the necessary ACL and related provision for credit losses, but there can be no assurance that our modeling process will successfully identify all of the expected credit losses in our loan portfolio. The assumptions around establishing reasonable and supportable economic forecasts are particularly subjective. As a result, we could record future provisions for credit losses that may be significantly different than the levels that we recorded in prior periods.
Current wording
Our methodology for determining the ACL and related provision for credit losses is described later in this section under “Provision for Credit Losses” and “Loan Portfolio”. In particular, this area of accounting requires a significant amount of judgment because a multitude of factors can influence the ultimate collection of a loan or other type of credit. It is extremely difficult to precisely measure the amount of expected credit losses in our loans held for investment (“HFI”) portfolio. We use a rigorous process to attempt to accurately quantify the necessary ACL and related provision for credit losses, but there can be no assurance that our modeling process will successfully identify all of the expected credit losses in our loan portfolio. The assumptions around establishing reasonable and supportable economic forecasts are particularly subjective. As a result, we could record future provisions for credit losses that may be significantly different than the levels that we recorded in prior periods.
Previous wording
A Lender Risk Account (“LRA”) has been established for loans we have sold to the Federal Home Loan Bank of Indianapolis (“FHLB”). The LRA is funded and maintained by the FHLB at 1.20% of the loan balance and is used to offset credit losses over the life of the loans sold to the FHLB. If the LRA has not been depleted by losses, funds are returned to the Company over time, beginning after five years and continuing through 25 years. We carry the asset at estimated fair value. Fair value is determined using an income approach with various assumptions including expected cash flows, market discount rates, prepayment speeds, and other factors. These assumptions are particularly subjective and can have a material effect on the estimated LRA balance and income. We believe the assumptions that we utilize in estimating fair value are reasonable based upon accepted industry practices and represent neither the most conservative nor aggressive assumptions.
Current wording
We have established an LRA for loans sold to the FHLB. The LRA is funded and maintained by the FHLB at 1.20% of the loan balance and is used to offset credit losses over the life of the loans sold to the FHLB. If the LRA has not been depleted by losses, funds are returned to the Company over time, beginning after five years and continuing through 25 years. We carry the asset at estimated fair value. Fair value is determined using an income approach with various assumptions including expected cash flows, market discount rates, prepayment speeds, and other factors. These assumptions are particularly subjective and can have a material effect on the estimated LRA balance and income. We believe the assumptions that we utilize in estimating fair value are reasonable based upon accepted industry practices and represent neither the most conservative nor aggressive assumptions.
Previous wording
We establish mortgage servicing right (“MSR”) assets when we sell loans with servicing retained and when we purchase mortgage servicing. The fair value of our mortgage loan servicing rights has been determined based on a valuation model used by an independent third party. There are several critical assumptions involved in establishing the value of this asset including estimated future prepayment speeds on the underlying mortgage loans, the interest rate used to discount the net cash flows from the mortgage loan servicing, the estimated amount of ancillary income that will be received in the future (such as late fees) and the estimated cost to service the mortgage loans. We believe the assumptions that we utilize in our valuation are reasonable based upon accepted industry practices for valuing mortgage loan servicing rights and represent neither the most conservative nor aggressive assumptions.
Current wording
We establish MSR assets when we sell loans with servicing retained and when we purchase mortgage servicing. The fair value of our mortgage loan servicing rights has been determined based on a valuation model used by an independent third party. There are several critical assumptions involved in establishing the value of this asset including estimated future prepayment speeds on the underlying mortgage loans, the interest rate used to discount the net cash flows from the mortgage loan servicing, the estimated amount of ancillary income that will be received in the future (such as late fees) and the estimated cost to service the mortgage loans. We believe the assumptions that we utilize in our valuation are reasonable based upon accepted industry practices for valuing mortgage loan servicing rights and represent neither the most conservative nor aggressive assumptions.
Previous wording
On July 4, 2025, “An Act to Provide for Reconciliation Pursuant to Title II of H. Con. Res. 14,” more commonly referred to as the “One Big Beautiful Bill Act” (OBBBA) was signed into law. OBBBA enacted broad changes to the domestic and international taxation arena by extending many expiring Tax Cuts and Jobs Act tax provisions among other individual and business tax relief measures, along with funding national defense and border security, cutting certain federal spending programs, phasing out certain renewable energy credits created by the Inflation Reduction Act, and raising the national debt ceiling, among other things. Management is currently evaluating the potential impacts of the provisions of the OBBBA to the Company, however, based on information available to date, we do not anticipate the OBBBA will have a material impact on the Company’s consolidated financial position or results of operations, absent any further changes in law.
Current wording
On July 4, 2025, “An Act to Provide for Reconciliation Pursuant to Title II of H. Con. Res. 14,” more commonly referred to as the “One Big Beautiful Bill Act” (“OBBBA”) was signed into law. OBBBA enacted broad changes to the domestic and international taxation arena by extending many expiring Tax Cuts and Jobs Act tax provisions among other individual and business tax relief measures, along with funding national defense and border security, cutting certain federal spending programs, phasing out certain renewable energy credits created by the Inflation Reduction Act, and raising the national debt ceiling, among other things. Management has evaluated the potential impacts of the provisions of the OBBBA to the Company, however, based on information available to date, we do not anticipate the OBBBA will have a material impact on the Company’s consolidated financial position or results of operations, absent any further changes in law.
Previous wording
•Net income available to common stockholders was $18.0 million for the three months ended June 30, 2025, an increase of $6.7 million, or 58.6%, from $11.4 million for the three months ended June 30, 2024.
Current wording
•Net income available to common stockholders was $20.1 million for the three months ended September 30, 2025, an increase of $3.0 million, or 17.7%, from $17.1 million for the three months ended September 30, 2024.
Previous wording
•Earnings per diluted common share was $0.51 for the three months ended June 30, 2025, as compared to $0.44 for the three months ended June 30, 2024.
Current wording
•Earnings per diluted common share was $0.57 for the three months ended September 30, 2025, as compared to $0.66 for the three months ended September 30, 2024.
Previous wording
•Net interest income before provision for credit losses was $36.5 million for the three months ended June 30, 2025, an increase of $7.9 million from the three months ended June 30, 2024, reflecting strong growth in MPP and AIO loans and an 11 basis point increase in net interest margin.
Current wording
•Net interest income before provision for credit losses was $40.3 million for the three months ended September 30, 2025, an increase of $11.9 million, or 42.0%, from the three months ended September 30, 2024, reflecting strong growth in MPP and AIO loans and a 27 basis point increase in net interest margin.
Previous wording
•Noninterest income was $22.4 million for the three months ended June 30, 2025, an increase of $5.5 million from the three months ended June 30, 2024, driven primarily by higher gain on sale of loans and other noninterest income, partially offset by lower loan servicing fees.
Current wording
•Noninterest income was $24.0 million for the three months ended September 30, 2025, a decrease of $1.7 million from the three months ended September 30, 2024, driven primarily by lower gain on sale of loans, MPP fees and service charges, partially offset by higher loan servicing fees and other noninterest income.
Previous wording
•Noninterest expense was $31.7 million for the three months ended June 30, 2025, an increase of $3.9 million from the three months ended June 30, 2024, driven primarily by higher salaries and benefits, largely attributable to bonus and incentive compensation and mortgage-related variable compensation, partially offset by lower expenses across several other categories.
Current wording
•Noninterest expense was $34.4 million for the three months ended September 30, 2025, an increase of $5.0 million from the three months ended September 30, 2024, driven primarily by higher bonus and incentive compensation, mortgage-related variable compensation and benefits expense.
Previous wording
•Loans held for investment (“HFI”) portfolio was $5.50 billion at June 30, 2025, an increase of $1.07 billion from December 31, 2024, reflecting increases of $1.18 billion in MPP balances and $50.7 million in AIO loans over the period.
Current wording
•Loans HFI portfolio was $5.97 billion at September 30, 2025, an increase of $1.54 billion, or 34.8%, from December 31, 2024, reflecting increases of $1.65 billion in MPP balances and $89.5 million in AIO loans over the period.
Previous wording
•MPP loans increased to 49.6% of total gross loans at June 30, 2025 from 36.8% at December 31, 2024, and residential mortgage loans decreased to 31.9% of total gross loans at June 30, 2025 from 41.9% at December 31, 2024.
Current wording
•MPP loans increased to 54.0% of total gross loans at September 30, 2025 from 36.8% at December 31, 2024, and residential mortgage loans decreased to 29.1% of total gross loans at September 30, 2025 from 41.9% at December 31, 2024.
Previous wording
•Liquidity remained stable, and total cash and cash equivalents increased to $415.7 million at June 30, 2025, as compared to $376.3 million at December 31, 2024.
Current wording
•Liquidity remained stable, and total cash and cash equivalents increased to $419.2 million at September 30, 2025, as compared to $376.3 million at December 31, 2024.
Previous wording
(1)Loan balance includes loans held for investment and held for sale. Nonaccrual loans are included in total loan balances and no adjustment has been made for these loans in the yield calculation. Interest income on loans includes amortization of deferred loan fees, net of deferred loan costs.
Current wording
(1)Loan balance includes loans HFI and held for sale. Nonaccrual loans are included in total loan balances and no adjustment has been made for these loans in the yield calculation. Interest income on loans includes amortization of deferred loan fees, net of deferred loan costs.
Previous wording
(2)Net loan fees of $30,000 and $62,000 for the three months ended June 30, 2025 and 2024, respectively, are included in interest income.
Current wording
(2)Net loan fees of $44,000 and $83,000 for the three months ended September 30, 2025 and 2024, respectively, are included in interest income.
Previous wording
The following table presents average balance sheet information, interest income, interest expense and the corresponding average yield earned and rates paid for the six months ended June 30, 2025 and 2024:
Current wording
The following table presents average balance sheet information, interest income, interest expense and the corresponding average yield earned and rates paid for the nine months ended September 30, 2025 and 2024:
Previous wording
(1)Loan balance includes loans held for investment and held for sale. Nonaccrual loans are included in total loan balances and no adjustment has been made for these loans in the yield calculation. Interest income on loans includes amortization of deferred loan fees, net of deferred loan costs.
Current wording
(1)Loan balance includes loans HFI and held for sale. Nonaccrual loans are included in total loan balances and no adjustment has been made for these loans in the yield calculation. Interest income on loans includes amortization of deferred loan fees, net of deferred loan costs.
Previous wording
(2)Net loan fees of $70,000 and $134,000 for the six months ended June 30, 2025 and 2024, respectively, are included in interest income.
Current wording
(2)Net loan fees of $114,000 and $216,000 for the nine months ended September 30, 2025 and 2024, respectively, are included in interest income.
Previous wording
For the three months ended June 30, 2025, net interest income was $36.5 million, an increase of $7.9 million, or 27.7%, from $28.6 million for the same period in 2024. This increase was driven primarily by a 21.7% increase in earning assets and an 11 basis point improvement in net interest margin.
Current wording
For the three months ended September 30, 2025, net interest income was $40.3 million, an increase of $11.9 million, or 42.0%, from $28.4 million for the same period in 2024. This increase was driven primarily by a 25.8% increase in earning assets and a 27 basis point improvement in net interest margin.
Previous wording
For the six months ended June 30, 2025, net interest income increased to $66.9 million, an increase of $11.1 million, or 19.9%, from $55.8 million for the same period in 2024. This increase was driven primarily by an 18.0% increase in earning assets and a 5 basis point improvement in net interest margin.
Current wording
For the nine months ended September 30, 2025, net interest income increased to $107.2 million, an increase of $23.0 million, or 27.4%, from $84.2 million for the same period in 2024. This increase was driven primarily by a 20.8% increase in earning assets and a 13 basis point improvement in net interest margin.
Previous wording
The increase in average interest-earning assets in both the three and six month periods of 2025, as compared to the same periods in 2024, reflect the strong growth within the MPP and AIO portfolios, partially offset by the continued run-off from the remainder of the loans HFI portfolio.
Current wording
The increase in average interest-earning assets in both the three and nine month periods ending September 30, 2025, as compared to the same periods in 2024, reflect the strong growth within the MPP and AIO portfolios, partially offset by the continued run-off from the remainder of the loans HFI portfolio.
Previous wording
The increase in net interest margin in both the three and six month periods of 2025, as compared to the same periods in 2024, was driven primarily by a decrease in the average rate paid on interest-bearing liabilities, which was partially offset by a smaller decrease in the average yield earned on interest-earning assets, both attributable to decreases in the federal funds rate. The net interest margin also continued to benefit from an improvement in the mix of interest-earning assets, with virtually all of the growth in loans coming from MPP and AIO, both of which carry higher average yields than the rest of the loan portfolio.
Current wording
The increase in net interest margin in both the three and nine month periods ended September 30, 2025, as compared to the same periods in 2024, was driven primarily by a decrease in the average rate paid on interest-bearing liabilities, which was partially offset by a smaller decrease in the average yield earned on interest-earning assets, both attributable to decreases in the federal funds rate. The net interest margin also continued to benefit from an improvement in the mix of interest-earning assets, with virtually all of the growth in loans coming from MPP and AIO, both of which carry higher average yields than the rest of the loan portfolio.
Previous wording
June 30, 2025, reflecting net charge-offs of $488,000 and an ending allowance for credit losses of $12.4 million. For the three months ended June 30, 2024, the provision for credit losses related to loans was an expense of $397,000, reflecting $742,000 in net charge-offs and an ending allowance for credit losses of $12.3 million. The increase in provision for credit losses for the three months ended June 30, 2025, as compared to the same period in 2024, was driven primarily by continued growth in the MPP portfolio, credit migration trends, and changes in the economic forecasts used in the credit models, partially offset by lower net charge-offs.
Current wording
For the three months ended September 30, 2025, the total provision for credit losses was $828,000, as compared to $178,000 for the same period in 2024. The provision for credit losses related to loans was an expense of $852,000 for the three months ended September 30, 2025, reflecting net charge-offs of $977,000 and an ending allowance for credit losses of $12.3 million. For the three months ended September 30, 2024, the provision for credit losses related to loans was an expense of $484,000, reflecting $0.6 million in net charge-offs and an ending allowance for credit losses of $12.2 million. The increase in provision for credit losses for the three months ended September 30, 2025, as compared to the same period in 2024, was driven primarily by higher loan charge-offs, largely attributable to two larger mortgage loans.
Previous wording
The provision for unfunded loan commitments was $35,000 for the three months ended June 30, 2025, as compared to a benefit of $99,000 for the three months ended June 30, 2024. The benefit in the 2024 period reflects lower levels of unfunded commitments driven primarily by continued run-off in the construction loan portfolio.
Current wording
The provision for unfunded loan commitments was a benefit of $24,000 for the three months ended September 30, 2025, as compared to a benefit of $306,000 for the three months ended September 30, 2024. The benefit in both periods reflects lower levels of unfunded commitments driven primarily by continued run-off in the construction loan portfolio.
Previous wording
For the six months ended June 30, 2025, the total provision for credit losses was $1.9 million, as compared to a benefit of $60,000 for the same period in 2024. The provision for credit losses related to loans was $1.9 million for the six months ended June 30, 2025, reflecting net charge-offs of $747,000 and an ending allowance for credit losses of $12.4 million. For the six months ended June 30, 2024, the provision for credit losses related to loans was $728,000, reflecting $733,000 in net charge-offs and an ending allowance for credit losses of $12.3 million. The increase in provision for credit losses for the six months ended June 30, 2025, as compared to the same period in 2024, reflects continued continued growth in the MPP portfolio, credit migration trends, and changes in the economic forecasts used in the credit models, partially offset by lower net charge-offs.
Current wording
For the nine months ended September 30, 2025, the total provision for credit losses was $2.7 million, as compared to $118,000 for the same period in 2024. The provision for credit losses related to loans was $2.8 million for the nine months ended September 30, 2025, reflecting net charge-offs of $1.7 million and an ending allowance for credit losses of $12.3 million. For the nine months ended September 30, 2024, the provision for credit losses related to loans was $1.2 million, reflecting $1.3 million in net charge-offs and an ending allowance for credit losses of $12.2 million. The increase in provision for credit losses for the nine months ended September 30, 2025, as compared to the same period in 2024, reflects continued growth in the MPP portfolio, credit migration trends, and changes in the economic forecasts used in the credit models, as well as higher net charge-offs, largely attributable to two larger residential mortgage loans.
Previous wording
The provision for unfunded loan commitments was a benefit of $55,000 for the six months ended June 30, 2025, as compared to a benefit of $788,000 for the six months ended June 30, 2024. The benefits in both the periods reflects lower levels of unfunded commitments driven primarily by continued run-off in the construction loan portfolio.
Current wording
The provision for unfunded loan commitments was a benefit of $79,000 for the nine months ended September 30, 2025, as compared to a benefit of $1.1 million for the nine months ended September 30, 2024. The benefits in both the periods reflects lower levels of unfunded commitments driven primarily by continued run-off in the construction loan portfolio.
Previous wording
The following table presents the major components of our noninterest income for the three and six month periods ended June 30, 2025 and 2024:
Current wording
The following table presents the major components of our noninterest income for the three and nine month periods ended September 30, 2025 and 2024:
Previous wording
For the three months ended June 30, 2025, noninterest income was $22.4 million, an increase of $5.5 million compared to the same period in 2024, driven primarily by higher net gains on sales of loans and other noninterest income, partially offset by lower loan servicing fees. For the six months ended June 30, 2025, noninterest income was $45.3 million, an increase of $11.8 million compared to the same period in 2024, driven primarily by higher net gains on sales of loans and other noninterest income, partially offset by lower loan servicing fees.
Current wording
For the three months ended September 30, 2025, noninterest income was $24.0 million, a decrease of $1.7 million compared to the same period in 2024, driven primarily by lower net gains on sales of loans from lower changes in the fair value of loans HFI and LRA, both attributable to changes in market interest rates. These were partially offset by higher loan servicing fees and other noninterest income. For the nine months ended September 30, 2025, noninterest income was $69.3 million, an increase of $10.0 million compared to the same period in 2024, driven primarily by higher net gains on sales of loans and other noninterest income, partially offset by lower loan servicing fees and service charges.
Previous wording
The following tables present the major components of our loan servicing fees and net gain on sale of loans for the three and six month periods ended June 30, 2025 and 2024:
Current wording
The following tables present the major components of our loan servicing fees and net gain on sale of loans for the three and nine month periods ended September 30, 2025 and 2024:
Previous wording
For the three months ended June 30, 2025, loan servicing fees decreased by $872,000 compared to the same period in 2024. For the six months ended June 30, 2025, loan servicing fees decreased by $3.7 million compared to the same period in 2024. The decrease in loan servicing fees in both the three and six month periods of 2025, as compared to the same periods in 2024, was driven primarily by lower revenues associated with a large bulk sale of serviced loans in the first quarter of 2024, as we made the strategic decision to scale back that part of our business. The decreases in each respective period was partially offset by an increase in the fair value of the MSR.
Current wording
For the three months ended September 30, 2025, loan servicing fees increased by $1.4 million compared to the same period in 2024. For the nine months ended September 30, 2025, loan servicing fees decreased by $2.3 million compared to the same period in 2024. The increase in loan servicing fees in the three months ended September 30, 2025, as compared to the same period in 2024, was due to a lower negative fair value change on MSRs and an increase in fees on servicing from higher levels of loans serviced for others. The decrease in loan servicing fees in the nine months ended 2025, as compared to the same period in 2024, was driven primarily by lower revenues associated with a large bulk sale of serviced loans in the first quarter of 2024.
Previous wording
For the three months ended June 30, 2025, MPP fees increased by $14,000, as compared to the same period in 2024. For the six months ended June 30, 2025, MPP fees increased by $211,000 compared to the same period in 2024. The increase in MPP fees in both the three and six month periods of 2025, as compared to the same periods in 2024, was driven primarily by an increase in overall volume of the MPP program.
Current wording
For the three months ended September 30, 2025, MPP fees decreased by $81,000, as compared to the same period in 2024. For the nine months ended September 30, 2025, MPP fees increased by $129,000 compared to the same period in 2024. The decrease in MPP fees in the three months ended September 30, 2025 as compared to the same period in 2024 reflects lower levels of participations during 2025. The increase in MPP fees in the nine month period of 2025, as compared to the same period in 2024, was driven primarily by higher levels of funded loans in the MPP business.
Previous wording
(1) - Includes the change in fair value of interest rate locks, loans held for sale, and held for investment.
Current wording
(1) Includes the change in fair value of interest rate locks, loans held for sale, and loans HFI.
Previous wording
(2) - Includes (a) net gain on sale of loans, (b) loan origination fees, points and costs, (c) provision from investor reserves, (d) gain or loss from forward commitments from hedging, and (e) fair value of LRA.
Current wording
(3) Includes (a) net gain on sale of loans, (b) loan origination fees, points and costs, (c) provision from investor reserves, (d) gain or loss from forward commitments from hedging, and (e) fair value of lender risk account.
Previous wording
(1) - Includes the change in fair value of interest rate locks, loans held for sale, and held for investment.
Current wording
(1) Includes the change in fair value of interest rate locks, loans held for sale, and loans HFI.
Previous wording
(2) - Includes (a) net gain on sale of loans, (b) loan origination fees, points and costs, (c) provision from investor reserves, (d) gain or loss from forward commitments from hedging, and (e) fair value of LRA.
Current wording
(3) Includes (a) net gain on sale of loans, (b) loan origination fees, points and costs, (c) provision from investor reserves, (d) gain or loss from forward commitments from hedging, and (e) fair value of lender risk account.
Previous wording
For the three months ended June 30, 2025, other noninterest income increased by $1.0 million, as compared to the same period in 2024. Included in other noninterest income for the three month period ended June 30, 2024 was a loss of $1.1 million on the sale of MSRs. We did not have any such losses in the 2025 period. For the six months ended June 30, 2025, other noninterest income increased by $3.0 million compared to the same period in 2024. For the six months ended June 30, 2025, we recognized a $2.0 million gain on debt extinguishment of $102.5 million in FHLB advances, and we did not have any such debt extinguishment gain or loss for the same period in 2024. Additionally, in the six months ended June 30, 2024 we recognized the loss of $1.1 million on the sale of MSRs. We had no such loss in the 2025 period.
Current wording
For the three months ended September 30, 2025, other noninterest income increased by $730,000, as compared to the same period in 2024. Noninterest income for the three months ended September 30, 2025 included net gains on sale of other real estate owned of $282,000 compared to net losses of $445,000 for the same period in 2024. Other noninterest income in the three months ended September 30, 2024 also included $312,000 in losses on lease termination and sale of assets. For the nine months ended September 30, 2025, other noninterest income increased by $3.8 million compared to the same period in 2024. For the nine months ended September 30, 2025, we recognized a $2.0 million gain on debt extinguishment of $102.5 million in FHLB advances, and we did not have any such debt extinguishment gain or loss for the same period in 2024. Additionally, in the nine months ended September 30, 2024 we recognized a loss of $1.1 million on the sale of MSRs. We had no such loss in the 2025 period.
Previous wording
The following tables present the major components of our noninterest expense for the three and six month periods ended June 30, 2025 and 2024:
Current wording
The following tables present the major components of our noninterest expense for the three and nine month periods ended September 30, 2025 and 2024:
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Previous report — wording carried elsewhere
For the three months ended June 30, 2025, the total provision for credit losses was $583,000, as compared to $298,000 for the same period in 2024. The provision for credit losses related to loans was an expense of $548,000 for the three months ended